Fournier Fixtures produces a variety of manufactured items for the home and building industry. The company produces only when it receives orders and, therefore, has no inventories. The following information is available for the current month: Actual (based on actual orders for 414,400 units) $7,873,600 Master Budget (based on budgeted orders for 370,000 units) $7,400,000 Sales revenue Less Variable costs Materials Direct labor Variable overhead Variable marketing and administrative Total variable costs Contribution margin Less Fixed costs Manufacturing overhead Marketing Administrative Total fixed costs Operating profits 2,646,400 238,000 1,218,400 876,000 $4,978,800 $2,894,800 2,350,000 218,000 1,082,000 786,000 $ 4,436,000 $2,964,000 1,632,000 556,600 372,000 $2,560,600 $ 334,200 1,660,000 540,000 405,000 $ 2,605,000 $ 359,000 Required:
Fournier Fixtures produces a variety of manufactured items for the home and building industry. The company produces only when it receives orders and, therefore, has no inventories. The following information is available for the current month: Actual (based on actual orders for 414,400 units) $7,873,600 Master Budget (based on budgeted orders for 370,000 units) $7,400,000 Sales revenue Less Variable costs Materials Direct labor Variable overhead Variable marketing and administrative Total variable costs Contribution margin Less Fixed costs Manufacturing overhead Marketing Administrative Total fixed costs Operating profits 2,646,400 238,000 1,218,400 876,000 $4,978,800 $2,894,800 2,350,000 218,000 1,082,000 786,000 $ 4,436,000 $2,964,000 1,632,000 556,600 372,000 $2,560,600 $ 334,200 1,660,000 540,000 405,000 $ 2,605,000 $ 359,000 Required:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Fournier Fixtures produces a variety of manufactured items for the home and building industry. The company produces only when it
receives orders and, therefore, has no inventories. The following information is available for the current month:
Actual (based on
actual orders for
414,400 units)
$ 7,873,600
Master Budget
(based on
budgeted orders
for 370,000
units)
$ 7,400,000
Sales revenue
Less
Variable costs
Materials
Direct labor
Variable overhead
Variable marketing and administrative
Total variable costs
Contribution margin
Less
Fixed costs
Manufacturing overhead
Marketing
Administrative
Total fixed costs
Operating profits
Required:
Prepare a profit variance analysis for Fournier Fixtures
2,646,400
238,000
1,218,400
876,000
$ 4,978,800
$2,894,800
2,350,000
218,000
1,082,000
786,000
$ 4,436,000
$ 2,964,000
1,632,000
556,600
372,000
$ 2,560,600
1,660,000
540,000
405,000
$ 2,605,000
$ 334,200
$ 359,000
Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for
unfavorable. If there is no effect, do not select either option.
Sales revenue
Variable costs.
Actual
Manufacturing
Variances
$
7,873,600
Materials
Direct labor
2,646,400
238,000
Variable overhead
1,218,400
Vanable marketing and administrative
876,000
Total variable costs
$
4,978,800
Contribution margin
$
2,894,800
Fixed costs
Manufacturing overhead
Marketing
Administrative
Total fixed costs
Operating profits
1,632,000
556,600
372,000
$
2,560,600
$
334,200
Fournier Fixtures
Profit Variance Analysis
Marketing and
Administrative
Variances
Sales Price Variance
Flexible
Budget
Master
Sales Activity Variance
Budget
$ 7,400,000
$
$
0
0
2,350,000
218,000
1,082,000
786,000
$ 4,436,000
$2,964,000
1,660,000
540,000
405,000
$ 2,605,000
S
0
$
0
$ 359,000
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